Cape Esperance Company Ltd v SLH Timber Co-oporation [1994] SBHC 88; HCSI-CC 87 of 1994 (8 April 1994)

IN THE HIGH COURT OF SOLOMON ISLANDS

Civil Case No. 87 of 1994

CAPE ESPERANCE CO. LIMITED

V

S.L.H TIMBER CO-OPERATION

High Court of Solomon Islands
(Palmer J.)

Civil Case No. 87 of 1994

Hearing: 6 April 1994
Ruling: 8 April 1994

A. Radclyffe for Defendants
T. Kama for 1st & 2nd Plaintiffs

PALMER J: Under a Writ of Summons filed on the 18th of March 1994, the First and Second Plaintiff claim an injunction against the Defendants, their agents, servants or contractors from:

a) felling and removing timber and conducting any timber operations in the area covered by the 1st Plaintiff’s Timber Licence No. TIM 2/5/81, known as Ward 1, Guadalcanal,

b) interfering with the contractual relations between the 2nd Plaintiff and his Co-administrator, John Sullivan, and Esthepia International Limited pursuant to an agreement between the said plaintiffs dated 29/4/93 sanctioned by the Court on 17 May 1993,

c) interfering in any manner whatsoever with the contractual relations between the First Plaintiff and the landowners of Ward 1 Guadalcanal, pursuant to a Timber Rights Agreement dated 5 December 1990.

On the same date an ex-parte application for restraining orders was made and an interim order issued accordingly.

By summons filed on the 28th of March 1994, the Defendants now apply to have that injunction discharged. The affidavit of Donation Damikura was filed on the 28th March 1994 in support of that summons.

In paragraph 2 of his affidavit, Donation Damikura states that he belonged to the Kakau sub-tribe which owned customary land in those parts of Wards 1 and 2 Guadalcanal Province and shown edged red on the map attached to his affidavit and marked “D.D.1”. The names of those customary lands are, Sara, Laovudi, and Hovi to Hidden Valley Lands. The First Defendant has been granted a milling licence TIM3/22, dated 6th August 1993 over those customary lands.

The essence of the Defendants claim is that although the First Plaintiff holds a timber licence covering Ward 1, the logging agreement entered into with certain people who claim to represent the customary landowners over Ward 1 did not include the customary lands referred to in paragraph 2 of Donation Damikura’s affidavit filed on the 28th March 1994.

In paragraph 4 of his affidavit, Donation Damikura stated that none of the signatories to the agreement of 5th December, 1990, represented his tribe or landowning group.

In his submissions before this court, learned Counsel for the Defendant, Mr Radclyffe pointed out several distinctive features about the logging agreement made by the First Plaintiff with the customary landowners of Ward 1.

The Defendants do not dispute that the First Plaintiff had a licence issued under section 5 of the Forest Resources and Timber Utilisation Act. They say however, that that licence is not an exclusive licence. He then referred to an additional logging agreement dated the 5th December 1990, (a copy of which is attached to the affidavit of Robert Victor Emery filed on the 18 March 1994) at paragraph 1, which read:

“In consideration of the undertaking by the company contained in this agreement and subject to the conditions, limitations and restrictions included herein, the representatives hereby grant to the company the right to fell, harvest and extract timber for sale from the customary lands on Ward 1, Guadalcanal Province.”

Mr Radclyffe points out that clause referred to Representatives of the Customary Landowners over the customary lands in Ward 1. However, no where in the logging agreement did it specify the names of those land-owning groups or the tribes which those signatories represented. Secondly, he pointed out that the names of the customary lands or the boundaries were not delineated on the map. He also pointed out that the boundary of Ward 1 is a political or constituency boundary and therefore did not necessarily correspond to any customary land boundary. In his client’s case for instance, they have identified clearly on the map attached to the affidavit of Donation Damikura filed on the 28 March 1994, and marked ‘DD1’, the boundary of their customary land and their names. As drawn, it overlapped into Ward 1, thus the reason for the injunction obtained by the plaintiffs.

In paragraph 5 of the same affidavit of Donation Damikura, he referred to correspondences made with other persons which showed that his land was not included in any logging agreement made with the First Plaintiff. The letter dated 2 March 1989 and marked exhibit ‘DD2’ was addressed to the Commissioner of Forests. The letter dated 9th June 1989 was addressed to Mr Bara Buchanan and a copy sent to the Permanent Secretary, Ministry of Natural Resources. In both letters, the customary landowners made very clear their stand and the identity of their lands.

Mr Radclyffe submitted that as the timber licence was only a bare licence, it could not give exclusive rights to the First Plaintiff over the Third Defendant’s customary lands. The First Plaintiff only has exclusive rights over timber in which a logging agreement had been concluded. In this particular case, the logging agreement made with the First Plaintiff did not, include the customary land of the Third Defendant.

The first point to consider obviously, is whether there are triable issues or serious issues raised before this court.

In the statement of claim filed with the Writ of Summons on the 18 March 1994, the only triable issue raised in my view relates to the contractual relations made between the First Plaintiff and the landowners of Ward 1 Guadalcanal, pursuant to a Timber Rights Agreement dated 5 December 1990. The Plaintiffs contend that that Timber Rights Agreement gave them exclusive rights over the whole of Ward 1. (Qurusu -v- Eagon Resources Development (SI) Ltd, CC4 / 93, Unreported).

The crucial issue, when narrowed down between the parties, is the question of who are the customary landowners over the customary lands of Sara, Laovudi and Hovi to the Hidden Valley Lands, and therefore lawfully entitled to grant timber rights over those lands? The first plaintiff say that it had already obtained the timber rights from the landowners who signed the 5 December 1990 Logging Agreement. The Defendants say no; they are rather the true customary landowners over those lands. The truth of the matter is that we have a customary land dispute brewing. And the only way in which such disputes can be sorted out is in using the procedures already laid down by Parliament. It is not for this Court to make any rulings or findings on the merits of the case at this point of time. This Court only needs to satisfy itself that there are triable issues that need to be heard in a trial proper. Until those issues are sorted out, it is the duty of the court to preserve the status quo as much as is possible, so that at the end of the day, the parties legal rights are affected or interfered with as little as possible. The Court must be satisfied that the claim of the Plaintiffs is not frivolous or vexatious, or without substance. The claim of the plaintiff may be general at this point of time, however, I am not satisfied that it is without evidential backing.

I am satisfied there is a serious issue as to the question of ownership of the customary lands as stated in the affidavit of Donation Damikura, and in relation thereto, the question of who is lawfully entitled to grant timber rights over those lands.

The next criterion is the question of adequacy of damages. Mr Kama has submitted in the written submissions that the First Plaintiff stand to lose approximately $l½ million (US) dollars, plus losses in production. There is no indication that the Defendants would be able to compensate the First Plaintiff for such losses. I am satisfied accordingly that an interlocutory injunction should be issued pending trial of the issues, but on the following conditions:

1. That the usual undertaking for damages be given.

2. That an action be commenced under the Local Court (Amendment Act) 1985, within 30 days, and if for any practical reasons that is not possible, then leave must be obtained for extension of that time limit before expiry of the 30 days. Failing the above, the interlocutory injunction shall lapse.

The ambit of the interlocutory injunction is in the terms as set out in the interim order issued dated the 18 March 1994.

I now turn to consider the question of whether, the Commissioner of Forests had the power to issue a licence under section 7 of the Forest Resources and timber Utilisation Act which also included the right to export round logs and indirectly the right to fell trees, when the ambit of section 7 seemed to be restricted only to the issue of milling licence. I think this matter can be held in abeyance at this point of time, as the very same question had already been argued before this court in the case of Jack Forest and Another - v - Mahlon Ali T / A Hova Hard wood Enterprises, and the Attorney General as Second Defendant, CC 1/94, and judgment is due to be given early next week.

Costs in the cause.

(A.R. Palmer)
JUDGE